Lack of diversity could undercut Silicon Valley

Attendees view smartphones running the latest edition of Android software during the Google I/O Annual Developers Conference in San Francisco, California, U.S., on Wednesday, June 25, 2014. Google Inc. unveiled a new version of its Android software for smartphones and other devices as it battles Apple Inc. to be the foundation for mobile technology. Photographer: David Paul Morris/Bloomberg ORG XMIT: 499376153(Photo: David Paul Morris Bloomberg)

PALO ALTO, Calif. — The technology industry's predominantly white and Asian male workforce is in danger of losing touch with the diverse nation — and world — that forms its customer base.

Recently released numbers from some of the largest and most powerful companies confirm what many had suspected: Opportunity here is not created equal.

Blacks and Hispanics are largely absent, and women are underrepresented in Silicon Valley — from giant companies to start-ups to venture capital firms.

The industry that bills itself as a meritocracy actually looks more like a "mirrortocracy," says longtime high-tech entrepreneur Mitch Kapor, co-chair of the Kapor Center for Social Impact.

Even as companies scramble to find workers in the most competitive hiring market in recent memory, most are continuing to bring aboard people who look like they do.

And that, Kapor says, could undercut Silicon Valley, which needs the best people and ideas to create the next Facebook or Google.

Eric Kelly is president and CEO of Overland Storage in San Jose, and chairman of Canadian-based Sphere 3D. He is also one of the few black CEOs of a publicly traded technology company. He says having managers and senior executives with differing perspectives gives companies like his an edge in the marketplace.

By 2040, the U.S. will be a minority majority, with 42% of the country black or Hispanic.

"I bet we'll be able to do some really interesting business case studies in 10 years and see what companies did and didn't make it — and who had the most diverse teams from top to bottom," Kelly said.

With the technology sector fueling the U.S. economy, the low rate of participation in high tech also threatens to drive up the unemployment rate for blacks and Hispanics, which is already three times the national average.

Computer science jobs are the fastest growing and command the highest salaries. Yet just one in 14 technical employees in Silicon Valley is black or Hispanic.

"The numbers are not where we want them to be," said Sarah Stuart, manager of global diversity and talent inclusion at Google.

Nationally, blacks make up 12% of the U.S. workforce and Hispanics 14%.

At Google, 3% of the staff^[1] are Hispanic and 2% black. At Yahoo and Facebook 4%^[2] are Hispanic and 2% black.

Unconscious bias

No one's saying this is the overt discrimination or explicit bias of the 1950s or even the 1970s. It's much more subtle and has everything to do with where you went to school, what you studied and who you roomed with, either at Stanford University or in your apartment in San Francisco's Mission District.

Silicon Valley is very network driven, and hiring is very referral based, says Laura Weidman Powers, co-founder of Code 2040, which works to bring blacks and Hispanics into companies.

It's "the guy in your dorm, the guy dating your sister, how Larry (Page) and Sergey (Brin) started Google," she says.

From that, patterns have emerged over time. White and Asian men fit the stereotypical image of a Silicon Valley engineer or entrepreneur and are more likely to get hired and promoted or funded, they say.

That's made it tougher for African Americans and Hispanics to break into Silicon Valley, and once they get the big job or start their own company, they confront obstacles.

Leah McGowen-Hare, a master technical instructor at Salesforce.com, says companies must venture outside of their comfort zones to find talented engineers and executives who break the Silicon Valley mold.

"You have to be intentional. You have to say, 'This doesn't look right. Why don't I have women or women of color on my development team?' It's not just going to happen," said McGowen-Hare, a black female coder. "Diversity and inclusiveness do not come easy. You have to expand your network."

Google and Facebook say they are increasing investments in education and outreach to draft more young people into the technology field, especially those who must overcome disadvantages such as poverty, troubled neighborhoods and low-performing schools.

These companies are also taking steps to combat unconscious bias by offering training to their employees.

Kiva Wilson, a diversity program manager at Facebook, says it's her goal to find "great underrepresented minority talent" and to make sure that Facebook creates an environment "where people feel included, affirmed and valued."

"We are seeing nothing short of a seismic shift in our field," said Freada Kapor Klein, founder of the Level Playing Field Institute in Oakland, which works to remove hidden barriers in business. "For years, tech leaders have perpetuated the myth that Silicon Valley is a meritocracy. Once we recognize it as a myth we can get down to the hard work of making the myth a reality."

That hard work is only getting started.

TD Lowe came to Silicon Valley to start her company in 2012. Shortly after arriving, she excitedly waited for her chance to say hello to a high-profile investor at a Silicon Valley meet-and-greet for young entrepreneurs.

Before she could tell him about her start-up, he advised her to forget any aspirations of starting a company and to get a job instead — she would never have the right connections to be successful in Silicon Valley.

It was just the first of many times in which technology investors and executives have second-guessed her technology credentials. But that has only made her double down on her company, EnovationNation in Palo Alto, which connects people with ideas to companies who need ideas.

"EnovationNation is not a great company because I am a black woman. It is a great company because it is a great product that helps other innovators," she said.

New generation

Tech workers of color say they are not looking for a handout, just an equal shot at the world's greatest wealth creation machine.

Tristan Walker, 29, belongs to a new generation forging a bright future in Silicon Valley.

After jobs with Twitter and Foursquare, he's pursuing the Silicon Valley dream by starting his own company, Walker & Co. Brands, a modern personal-care brand for people of color.

He says he's targeting a market worth billions but that is woefully underserved. He recently landed $6.9 million in funding from a top venture capital firm — but not before being rejected by every other firm he approached.

The experience frustrated him, but he says he has never experienced explicit racial bias in Silicon Valley.

"I truly believe that Silicon Valley is meritocratic," Walker said. "No one underestimates anyone else here. You could be walking around in ripped jeans and a dirty T-shirt and be worth a billion dollars. Anyone can do anything pretty important here."

And he has set out to prove it. His Palo Alto company asks his investors to recommend qualified candidates who are women and minorities for job openings first.

He's been so successful in recruiting from these underrepresented groups that there is only one white man working in his 13-person company.

"We joke all the time that I should e-mail our investors and ask them to think of any white men we can hire," Walker said.

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References

1. ^{^} http://www.usatoday.com/story/tech/2014/05/28/google-releases-employee-diversity-figures/9697049/ (rssfeeds.usatoday.com)
2. ^{^} http://www.usatoday.com/story/tech/2014/06/17/yahoo-lack-of-diversity/10718789/ (rssfeeds.usatoday.com)